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Palin announced she was resigning her office due to the costs and distractions of battling ethics investigations describing the “insane” amount of time and money that both she and the state of Alaska had expended responding to "opposition research", 150 FOIA requests and 15 "frivolous" legal ethics complaints filed by "political operatives" against her.[2][3][4][5][6][7] She said the state had spent $2 million while she and her husband, Todd, would be spending "more than half a million dollars in legal bills in order to set the record straight."[8] While media sources backed Palin's statement that she had incurred large, personal financial debts defending against the ethics charges, the Anchorage Daily News reported that much of the $1.9 million cost cited by Palin consisted of the normal state employee salaries.[9] However, the Governor's spokesperson said that in order to respond to the ethics complaints, staffers from multiple state agencies were diverted from their normal duties and state attorneys were pulled off their case loads resulting in "lost value to the state", and "hundreds of thousands of dollars" spent on outside legal counsel and equipment.[9] In addition to responding to the ethics complaints, the state attorneys had to review the public record requests including the 238 filed during Palin's administration and 189 after she was named John McCain's running mate.[9]

Palin cited the decision to not seek re-election and resign from office would avoid her being a lame duck politician who is ineffective and "milk" the taxpayers by drawing a paycheck and funding useless travels. She said, "I'm not putting Alaska through that..." and "...it may be tempting and more comfortable to just keep your head down, plod along, and appease those who demand: 'Sit down and shut up,' but that's the worthless, easy path; that's a quitter's way out".[5]

Palin declared that although she loved her job and it hurt to leave it, her decision was in the best interest of Alaska. She said she expected to continue her involvement in public affairs as a private citizen and the lack of an official title would not bother, nor hamper her effectiveness.[5]

According to the Anchorage Daily News, "Early estimates put the cost of Sarah Palin's midterm resignation as Alaska governor at a minimum of $40,000, not including a special legislative session partly linked to her departure. ... The final price tag will be a mere fraction of the roughly $2 million Palin has said it cost the state dealing with "frivolous" ethics complaints against her."[11] Information on the cost of the resignation was obtained by The Associated Press through a public records request.[11]

On December 22, 2010, new rules governing Alaska executive branch ethics, stemming from Sarah Palin's tenure as governor, took effect:[12]

"These include allowing for the state to pay legal costs for officials cleared of ethics violations; allowing for a family member of the governor or lieutenant governor to travel at state cost in certain circumstances and allowing an immediate family member to use an official's state-issued cell phone or BlackBerry if the usage is limited or under monthly or unlimited plans."[12]

The Alaska attorney general clarified several ethics rules, including those related to family travel.[12]

^Fund, John (7 July 2009). "Why Palin Quit: Death by a Thousand FOIAs" (Opinion: John Fund on the Trail). Wall Street Journal. This situation developed because Alaska's transparency laws allow anyone to file Freedom of Information Act requests. While normally useful, in the hands of political opponents FOIA requests can become a means to bog down a target in a bureaucratic quagmire